Sunday, November 29 , 2015, 8:03 am | Fair 44º

Randy Alcorn: Squealing over Sequestration Reaches a Sizzling Pitch

By Randy Alcorn, Noozhawk Columnist |

Everyone wants to avoid the pain of balancing the federal budget and paying down the astronomical federal debt, now more than $15 trillion and growing. The Stupid Party (thank you, Bobby Jindal), aka the Republicans, vehemently opposes tax increases and instead pushes for cuts to domestic programs, while the Spending Party, aka the Democrats, wants to preserve domestic programs and raise taxes on the wealthiest Americans.

Since neither party could advance the budget ball out of the ideological scrum of national politics, both parties agreed to pass the Budget Control Act of 2011. That debt-ceiling compromise provided for automatic, mostly undiscriminating, reductions to federal spending, aka sequestration. The jump off that “fiscal cliff” scheduled for Jan. 1, 2013, was postponed until March 1, and as I write this neither the Stupids nor the Spenders has flinched.

The Spenders, led by President Barack Obama, are conducting a blatantly choreographed fear campaign to convince the public that sequestration would tank the economy and put the nation in danger from “drastic” cuts to critical services. Meanwhile, the Stupids are doing what they usually do these days — dutifully opposing anything the Spenders propose — and have little to offer but ideological bromides based on failed trickle-down economic theories, Ayn Rand fantasies, and romantic notions of 19th-century frontier self-reliance.

Not surprisingly, neither party is being realistic or honest. The essential reality is that federal spending must be reduced. The government simply cannot sustain its prodigious spending funded by ever-growing debt. Eventually, paper dollars will be exposed for what they are, high-quality paper with fine artistic engravings, but otherwise worthless.

Given our dysfunctional Congress, sequestration may be the best we can do for now to address the national debt. The Spenders’ fear-mongering aside, sequestration may not be an unreasonable first step. Total annual federal spending is about $3.5 trillion. The sequestration reduces that spending over nine years, initially at a clip of about $90 billion per year, increasing to an average of about $130 billion over the later years. That is a mere 2.6 percent to 3.7 percent reduction; and Medicaid, Social Security, military pay, food stamps and family-assistance programs are exempt from sequestration cuts. This is hardly draconian or over ambitious.

The Spenders do protest sequestration too much, methinks. If an annual reduction of $90 billion in government spending is enough to tank the $15 trillion U.S. economy, then the economy is hopelessly fragile and unsustainably over-dependent on government deficit spending.

About 42 percent of total sequestration reductions come from defense, as they should. This nation grossly overspends on defense — much of it wasteful. Nevertheless, outgoing Defense Secretary Leon Panetta warned that the sequestration cuts would make America a second-rate military power. Really? Second to whom? America already spends more on defense that do the next 15 or so highest defense-spending nations combined. Sequestration takes less than 10 percent away from defense.

Furthermore, one of the larger cuts to defense would be fighter jets, some of which the military has said it does not need, but that some pork-barrel congressmen insist on providing to keep their constituents and clients happy.

This is a perfect example of the problem we have in balancing the federal budget. There are so many snouts in the federal trough that whenever a hog is threatened with losing some slop the squealing is ear-piercing. Every hog feels it is more entitled than are the other hogs. In fact, most of them could sustain a cut in rations, while some could be slaughtered for bacon.

A good place to find bacon is in Congress. Now, there is where we can find some of the most overfed hogs and sows sucking up federal slop. How about we furlough these pigs? They do not get anything done anyway — except to be sure to give themselves singularly generous pay and benefits for their “service.” Do we really need these swine rooting around Washington, D.C., most of the year? Cut their “service” time back to three or four months per year, and take away their exclusive benefits. They can join the rest of us on Social Security and Medicare.

The biggest mistake this nation made was granting the federal government the right to tax incomes. It showered Congress with the booty that financed the hog farm we have now. It funded a massive, intrusive, increase in federal power and shaped a federal government beholden to special interests rather than to best interests.

But, if the money is not there to pay for federal excesses, government must assume a more frugal, limited role in our lives. And, as federal power shrinks, selfish special interests have less opportunity to influence policy that affects us all.

If the hogs are squealing, let them. Bacon is tasty.

— Randy Alcorn is a Santa Barbara political observer. Contact him at .(JavaScript must be enabled to view this email address), or click here to read previous columns. The opinions expressed are his own.

comments powered by Disqus

» on 02.25.13 @ 12:19 AM

Thank you Randy Good article. Right on

» on 02.25.13 @ 01:47 AM

As usual, Alcorn nails it.
It’s going to be an interesting week.

» on 02.25.13 @ 11:52 AM

Wishing it was just this simple.  Of course it is not - just look to Europe and Japan and how their austerity economics have prevented any kind of economic stability.  Why is it so difficult for congress to “talk”, not “scream” but talk.  We all want the same things, it’s just getting there that seems to be the problem.  The Reagan economics is what got us where we are, so why don’t we try something that we know works?  Probably because “saving face” is more important than “doing what is right”.

» on 02.25.13 @ 12:45 PM

Joan R, To what do you refer when you suggest that “we try something that we know works?” Just what is it that “works?”

If you mean to cut back and eventually eliminate programs that should not be the purview of the federal government under the Constitution or cutting out all the social engineering programs or eliminating all the federal giveaways AKA “grants” for every pet program around the country, then I would agree.

But if you mean to increase taxes even more than they already are on the top half of taxpayers, then I don’t agree with you.

» on 02.25.13 @ 02:06 PM

Excellent article.

» on 02.25.13 @ 05:18 PM

I agree with the article but equating the two parties as equally culpable is way too simplistic. Although Randy may not want to admit it, most Republicans in Congress advocate reduced spending, exactly the same solution that Randy wants. Any reasonable observer would have to conclude that Democrats are way more a problem regarding govt spending and taxing anything that moves.

» on 02.25.13 @ 06:04 PM

Good, honest job by Alcorn.

The only thing that should be sequestered, immediately, is the pay and benefit
package for all the leaders of Congress, from both parties.

They should be locked into a small room, with refreshments provided by the local food bank (not the K Street lobbyists), and not allowed to come out until they have an agreement that’s fair and equitable, to the benefit of America, not the array of special interests they all shamelessly shill for.

One interesting reality of modern congressional life is that the work hours are
the lowest in 70 years, the pay and benefits the highest. The work week spends
more time fund-raising and traveling, than it does in-session.

No wonder these polarized, ideological, shrunken intellects can’t get anything
done on time on any issue.


Obama’s team isn’t much better, pretended a few billion out of Trillions in debt
and deficits, is going to destroy modern life.

Obviously that public pretense is a lot easier than rolling up his sleeves, and
taking a hard look at Simpson-Bowles, at Medicare, Social Security, Defense,
and modern retirement age, given actuarial tables about extended lifespan.

But no, Obama’s so engaged that he golfs with Tiger Woods, while his wife has
time to dress up to hand out Academy Awards by video-remote. Ridiculous!

» on 02.25.13 @ 06:26 PM

Excuse me gentlemen, but please, let’s not get into name-calling, and tired old cliches.  As a member of “The Silent Generation” I still consider the greater good and I encourage all of you to follow suit.  This is about our country, not any one President, First Lady, or member of Congress.  Let’s keep our sights high, our mouths and pens positive and thoughtful.

» on 02.25.13 @ 07:28 PM

“Excuse me gentlemen, but please, let’s not get into name-calling, and tired old cliches.”

“The Reagan economics is what got us where we are”

Joan R, people who live in glass houses talk too much.

» on 02.25.13 @ 08:36 PM

Right on Randy. Joan R. the reasons austerity measures didn’t work in European nations is that they still spend far more than they earn. In Japan they invested their huge loot made from taking over the US manufacturing sector on real estate investment in the US. The recession at the end of the nineties, where real estate values plummeted, wiped out their enormous wealth and they thought they could recover doing exactly what we are doing now, thus a 15 year recession born out of excessive government spending of money they didn’t have. Japan is a huge giant red flag with warning flashers and blaring sirens screaming “this doesn’t friggen work you idiots, don’t do it”. But we did and now we will have 4 more years of it and God knows how many more decades afterwards to recover.

Its real simple Joan, we do know what works, make your own stuff and make enough to sell surplus. Run a trade surplus and don’t spend what you don’t friggen have. That works.

» on 03.07.13 @ 01:54 PM

“... make your own stuff and make enough to sell surplus. Run a trade surplus and don’t spend what you don’t friggen have. That works.”

And what are teachers, hospital workers, researchers and all those who make a contribution to society at large that don’t “make stuff” supposed to do? Have a second manufacturing job so they can pay their bills and feel like their life has value? It’s not just about creating a product. That’s an over simplification!

» on 03.07.13 @ 03:33 PM

The fact about this “sequester” that is so ludicrous and seems to be lost on most is that the cuts are really cuts in this year’s budget INCREASE from last year (except for DOD). They still are getting more $ to spend. So why didn’t we have to make all of these cuts last year when the budget was even lower?

The administration, and many in congresss, are trying to make this “sequester” as painful as possible to the public. Most of the public are too ill-informed to realize that it is all a scam.

» on 03.07.13 @ 10:33 PM

Keepingfamiliessafe, what they are supposed to do is SUPPORT those sectors of our economy that pay for their livelihood and not assume the world can go on without them. Instead we tell our children to go make their way in life without any regard at all how that way gets paid for. We now have a country that has more takers than producers, how in the world do we keep up? We don’t, and the proof is that our society has become comfortable borrowing its prosperity rather than earning it.

Please for the love of God wake up and look at what has become of us. We are all become parasites, depending on a smaller and smaller number of people and enterprises to support our outlandish expectations. Doctors, lawyers, entertainers, teachers, politicians, clerks, janitors and wall street fat cats must have a source of increasing value made some where or we are just cannibalizing other parasites.

Its not oversimplification, it IS the fundamental core of how an economy works. And you mark my words here if we don’t stop going the way we are, the vast wealth generated by generations before us will be squandered and nothing will be left for anyone.

» on 03.08.13 @ 04:13 PM

Currently in CA, there are more people on some sort of government welfare than are employed. This is also true in ten other states. How long do you suppose that can be sustained?

A report of the Congressional Research Office/Senate Budget Committee 2 months ago shows that the total amount we spend on welfare across the country averages out to $167.65 per person per day (if all program benefits were converted to cash) for those living below the federal defined poverty level while the median household income for all is only $137.13 per person per day. With that current scenario being played out is there any incentive for the takers to become givers?

» on 03.09.13 @ 01:47 PM

Art I hope people don’t misunderstand what I am saying, its not just welfare recipients that are parasites but anyone whose work or enterprise consumes more economic value than it produces in return. This is very hard to measure. The classic differentiation is between the three producers, agriculture, mining and manufacturing and the consumers, services and government.

However, you can find producers and consumers in all categories of human enterprise. The key is in measuring total output versus total consumption and seeing if you are gaining or losing value. Our economy typically gains, thus the appearance of productivity, but a glaring trade deficit, enormous public and private debt and the shrinking of productive enterprises for those that consume, means something in the calculations is not germane.

Our living standards are waning; we require far more work for the same consumption of goods and services, we have less free time and less disposable income. That is where our output versus consumption is balancing out.

In the end we are on an unsustainable economic path. We grow ever poorer while those who make our stuff grow ever richer and our society becomes far more stratified. Some believe economic redistribution is the answer and they push hard for more government, regulation and punishment of success. But they are simply redistributing a shrinking amount of pie. The end will be an equal outcome society which may be fairer in their eyes but who cares if everyone is equally destitute?

» on 03.14.13 @ 12:39 PM

You cannot manufacture your way out of this. Manufactured goods are just one more consumable item, like a service.

If nobody can afford your goods or services, there is no economy.

We have skewed our economy badly in this country. We subsidize cheap feed for cattle so fast food joints can make cheap feed for people. Food that makes them fat and sick.

If you calculate the taxpayer money spent subsidizing feed crops for cheap beef and high-fructose corn syrup, then add to that the subsistence aid we provide to the fast food workers because their employers only pay them a sub-poverty wage, you realize that the Big Mac and fries you just bought for $6 really cost about $15. That’s a net loss to all of us, with an outcome that includes no benefit. Similar cases include petroleum and military spending.

What I’d like to see come out of the budget negotiation is a major re-alignment away from subsidies to special interests. We need energy, education, infrastructure, and a basic universal health plan (that is not the responsibility of employers). Subsidize those things, not Jack In The Box.

» on 03.14.13 @ 01:16 PM

Rambler said that “Manufactured goods are just one more consumable item, like a service.”

When I took Economics, there was no comparison between the two - you don’t create value with a service whereas you do with a manufactured product.

Has the study of Economics changed that much?

» on 03.15.13 @ 12:02 AM

Art, maybe you should think a little deeper. If you are sick, the most productive thing you can do is get well, and the doctor enables that - your return to productivity. If you are being robbed of your ability to be productive, the lawyer may be the one who fixes that problem.

All this crap about manufacturing being the pure form - that’s all it is, crap. Without the services that make society work, there is no productivity and there is no market. It’s symbiotic.

There is no economy without consumers. If the consumers are sick or unjustly deprived of their ability to be consumers of services and products, then the manufacturer is a meaningless entity.

» on 03.15.13 @ 05:04 PM

Rambler, no one said services weren’t necessary, just that the value they consume exceeds the value they add on a net basis. Manufacturing adds more value than it consumes doing it on a net basis. If you cannot understand that then honestly I don’t know what else to tell you. If you really believe a society can grow more prosperous, let alone sustain itself on just services, I dare you to prove it. And please don’t insult us with some dopy example of Switzerland, a country who is small enough that they can have a nearly total financial services economy and become wealthy doing it. The US is far too large to ever scale that model up.

» on 03.17.13 @ 06:44 PM

Bishop, I too don’t know why you bother. Tell us why you label Switzerland a service economy, and why it is not scalable.

If I fix a problem with a machine in a factory, and the productive yield of that machine is increased as a result, how would you measure the net value added as a result? Would my service still be a net consumer of value?

If a doctor saves a life, and that person lives long enough as a result of that service to invent a cure for cancer, did the doctor still consume net value?

Your arguments are too simplistic.

» on 03.22.13 @ 12:38 PM

Rambler, in retrospect Switzerland was probably not a good example of the service economy I was trying to example. But to answer the larger question of why you can’t scale up a service economy that may be profitable to a sovereign country is the economy of scale. In a global market, if you are a small country (in population) and are able to provide a service that is desired by the global economy then you will do well (high demand, low supply). However, scale that country up, so its population, GDP and consumption is a greater percentage of the overall global economy, then you would have to provide quite a bit more of that service to maintain the same income. At some point your service reaches market saturation and now you have a high supply and the same demand. Good for the consumer of the service, not so good for the supplier.

I realize that seems simplistic, however it is what it is.  Now on to the repair question, yes your service is still a net consumer. It is an added cost to the machine’s function. The formula may be a bit complicated but the short of it is that a perfect machine would run for ever and use no energy. The cost basis for determining a value then comes from what that perfect machine can produce minus all the “real” costs involved in actually running a real machine, repairs, labor, energy, etc.. If the value of the product made (what the market is willing to pay for it) exceeds the costs of operation then generally the machine is “profitable”. When we do machine efficiency calculations we try to minimize “repair” because its only making right what is not and not making product. It doesn’t mean your repair service is not valued, but it does not add value and thus should be minimized.

Your doctor example is a different value statement. We all value doctors, but from an economic stand point they are a net value subtraction. If a doctor saves the life of my factory worker and she is able to continue to work productively then that medical service is no different than your repair. However, if she invented a new process that shaved energy and time off the line then its a net plus. If that doctor saved a person from cancer and they went on to become a Bill Gates whose software manufacturing company made trillions in economic wealth a plus, if he saves an Al Gore it’s a minus. But on the whole we see medicine consuming vast quantities of time, energy and material, but we do not see a resulting increase in productivity, innovation or wealth generation for the money spent.

The US economy has been one of the most prosperous in the world, but right now we are loading it with a lot of non value added activities and the result is we are seeing a net decline in living standards. Regardless of the class warfare statements on wealth generation we simply do not produce enough net wealth to support our vast consumption. Redistribution of wealth would not balance it, not even come close. That is a reality much of Europe is grappling with right now and we have ignored for decades.

» on 03.23.13 @ 12:03 PM

I’m not sure you have your “perfect machine” arguments well thought out, Bishop. They sound a lot like Ayn Rand.

As for wealth creation and “wealth redistribution” I would cite the free market. Your market determines what you get for your ideas, your labor, and your investments. If your market determines that it has paid too much, you may want to find another market. Or adapt.

Many people participate in the generation of wealth, but when only a few benefit there may already have been a “wealth redistribution” taking place. Think about that. The statistics on wealth distribution over the past 60 or so years tell a much different story than the one your fascist right-wing school is teaching.

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